New York is the Fourth Biggest Net Loser of Federal Spending in 2013

Nov 16, 2015

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In the course of collecting taxes and spending money, the federal government inevitably creates “winners” and “losers” across the American landscape. In Fiscal Year (FY) 2013, New York is the fourth biggest net loser of federal spending relative to federal taxes paid.

The late New York Senator, Daniel Patrick Moynihan (D), was a vocal critic of this financial reshuffling caused by federal tax and spending policies because he believed New York was a net loser. In fact, he was the driving force behind the U.S. Census Bureau’s Consolidated Federal Funds Report that tracked federal spending by state and county. Without such a strong advocate, the report was cancelled a few years after his death—please contact the Census Bureau to advocate for the program’s reinstatement.

As shown in Chart 1, New York paid $14,276 per person in federal taxes in FY 2013—this was 33 percent above the national average ($10,722 per person) and ranked as the 5th highest level in the country.

Corporate Income Tax: The federal corporate income tax paid in New York was $1,082 per person—this was above the national average of $865 per person by 25 percent and ranked as the 6th highest in the country.

Payroll Tax: The federal payroll tax paid in New York was $3,409 per person—this was above the national average of $2,998 per person by 14 percent and ranked as the 12th highest in the country.

Excise Taxes: Federal excise taxes paid in New York was $235 per person—this was below the national average of $266 per person by -11 percent and ranked as the 2nd lowest in the country.

Estate and Gift Taxes: Federal estate and gift taxes paid in New York was $71 per person—this was above the national average of $60 per person by 19 percent and ranked as the 7th highest in the country.

Custom Duties: Federal custom duties paid in New York was $118 per person—this was above the national average of $101 per person by 17 percent and ranked as the 6th highest in the country.

Miscellaneous Taxes: Federal miscellaneous taxes paid in New York was $380 per person—this was above the national average of $325 per person by 17 percent and ranked as the 6th highest in the country.

Deficit: The federal deficit, which is deferred taxation, accrued in New York was $2,883 per person—this was above the national average of $1,944 per person by 48 percent and ranked as the 4th highest in the country.

On the other hand, as shown in Chart 2, New York received $11,075 per person in federal spending in FY 2013—this was 3 percent above the national average ($10,722 per person) and ranked as the 22nd highest level in the country.

Federal Spending by Type in FY 2013:

Retirement and Disability:Federal retirement and disability payments (for example, Social Security and federal civilian and military retirement) in New York was $3,083 per person—this was below the national average of $3,318 per person by -7 percent and ranked as the 9th lowest in the country (see our unique app showing federal pension data).

Other Direct Payments: Federal other direct payments (for example, Medicare and the Earned Income Tax Credit) in New York was $2,889 per person—this was above the national average of $2,500 by 16 percent and ranked as the 11th highest in the country.

Grants to State and Local Governments: Federal grants to state and local governments (for example, Medicaid) in New York was $2,959 per person—this was above the national average of $1,811 by 63 percent and ranked as the 4th highest in the country.

Procurement: Federal procurement (for example, Department of Defense) in New York was $593 per person—this was below the national average of $1,337 by -56 percent and ranked as the 14th lowest in the country.

Interest on National Debt: Federal interest paid on the national debt in New York was $871 per person—this above the national average of $699 by 25 percent and ranked as the 5th highest in the country.

Of course, federal taxes paid and federal spending received do not flow evenly throughout the state. As such, we have also calculated the federal tax and spending ratios for every county in New York—though this was based on slightly older FY 2010 data.

The top ten New York counties with the highest federal tax and spending ratios include:

Jefferson County, NY ($3.30)

Albany County, NY ($2.35)

Tioga County, NY ($1.87)

Rensselaer County, NY ($1.51)

Cattaraugus County, NY ($1.39)

Chautauqua County, NY ($1.16)

St. Lawrence County, NY ($1.16)

Lewis County, NY ($1.13)

Oneida County, NY ($1.09)

Delaware County, NY ($1.09)

The bottom ten New York counties with the lowest federal tax and spend ratios include:

Putnam County, NY ($0.33)

Westchester County, NY ($0.37)

Saratoga County, NY ($0.40)

Nassau County, NY ($0.50)

Rockland County, NY ($0.50)

Dutchess County, NY ($0.53)

Suffolk County, NY ($0.54)

Madison County, NY ($0.66)

Ulster County, NY ($0.68)

Livingston County, NY ($0.69)

More county detail for New York is shown in the color-coded map below.

Note: The data is based on the federal fiscal year that runs from September 1 to October 30.

Wendy Warcholik

Dr. Wendy P. Warcholik has worked in public policy for nearly 20 years. She is currently the Director of the Family Prosperity Initiative at the American Conservative Union Foundation. She has also been at the Bureau of Economic Analysis, The Tax Foundation, and The Oklahoma Council of Public Affairs. She received her PhD in Economics from George Mason University (Fairfax, VA).